# Deductible Coverage Endorsement

## I. Annual Aggregate Deductible Amount

D. If an Annual Aggregate Deductible Amount (the "Aggregate") is shown in the Schedule, that amount is the most you must reimburse us for all damages, benefits and Medical Payments and "Allocated Loss Adjustment Expenses" that we pay under this policy and all other policies listed in Part 1 of the Schedule.

The Aggregate will not be reduced if this or any other policy described in the Schedule is issued for a term of less than one year, or if this endorsement or any policy described in the Schedule is canceled before the end of the policy period by you, or by us because of your failure to pay premium or to reimburse us under the terms of this endorsement when due.

If we cancel this endorsement or all the policies described in the Schedule for any other reason, the Aggregate will be prorated in the proportion that the period that it was in effect bears to the original policy period. If we cancel one or more, but not all, the policies described in the Schedule for any other reason, the Aggregate will be prorated in the proportion that the total expected deductible losses under all the described policies, calculated according to our rating plan, during the period that the policies were in effect, bears to such total expected deductible losses during the original policy period. However, the Aggregate so prorated shall not be less than the largest Deductible limit shown in the Schedule.

If no Aggregate is shown in the Schedule, no aggregate limit applies to your reimbursement obligation.

## II. Additional Conditions

A. Duty to Reimburse

1. You must reimburse us in accordance with this endorsement for any payment we make in good faith on behalf of any person or organization insured under any policy to which this endorsement applies.
2. Reimbursement is due and payable within fifteen (15) days of your receipt of an invoice for such reimbursement from us.
3. Each Named Insured is jointly and severally liable for all reimbursable amounts under this policy.

B. Defaults and Remedies

If you fail to perform any of your duties under this endorsement, we may take any reasonable steps necessary to protect our interest, including the following:

We may cancel this endorsement or the policies to which this endorsement applies by mailing or delivering written notice to you not less than ten (10) days prior to the effective date of such cancellation, stating the day and hour the cancellation is to take effect. Proof of the mailing of such notice to you at your mailing address shown in Item 1 of the Information Page will be sufficient to prove notice.

C. Recovery From Others

We have your rights and the rights of persons entitled to the benefits of this insurance to recover all payments, including those within your reimbursement amount, from anyone liable for the damages. You will do everything necessary to protect those rights for us and to help us enforce them.

If we recover any payment we made under this policy from anyone liable for the damages, the amount we recover will first be applied to any payments we made in excess of the reimbursable amount or in excess of the Aggregate, and to our expenses in obtaining the recovery. We will apply the remainder of the recovery, if any, to reduce the amount that is reimbursable by you.

## III. Additional Definition

"Allocated Loss Adjustment Expenses" means all fees for service of process and court costs and court expenses; pre- and post-judgment interest; attorneys' fees; cost of undercover operative and detective services; costs of employing experts; costs for legal transcripts; copies of any public records; and costs of depositions and court-reported or recorded statements; costs and expenses of subrogation; and "any similar fee, cost or expense reasonably chargeable to the investigation, negotiation, settlement or defense of a loss or a claim or suit against you, or to the protection and perfection of your or our subrogation rights."

Allocated Loss Adjustment Expenses shall not include our general overhead, the salary and employee benefits of any of our employees, nor the fees of any attorney who is our employee or under our permanent retainer; nor the fees of any attorney we retain to provide counsel to us about our obligations, if any, under any policy issued by us or our affiliated company (ies), with respect to a claim or suit against you.

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